Escobal is a high-grade, underground mine that reached commercial production in January 2014 and produced 20.3 million oz of silver in concentrates during the year. La Arena is an open-pit, heap-leach mine that produced its first gold in May 2011 and produced 222,255 oz of gold during 2014.

A 2015 construction start is scheduled for Rio Alto’s Shahuindo open-pit, heapleach gold project 30 km north of La Arena. Initial mine production is planned at 10,000 mt/d, and gold equivalent production is forecast at 90,000 oz/y. First production is expected in 2016.

Under the terms of the merger agreement, all of Rio Alto’s issued and outstanding common shares will be exchanged on the basis of 0.227 of a Tahoe common share and C$0.001 in cash per Rio Alto share. Upon completion of the transaction, existing Tahoe and Rio Alto shareholders will own approximately 65% and 35% of the combined company, respectively.

The executive management team and board of directors of the combined company will draw on personnel from both companies. Kevin McArthur, current vice chair and CEO of Tahoe, will be executive chairman of the board, and Alex Black, current president and CEO of Rio Alto, will be CEO of the combined company. Tahoe President and CEO Ron Clayton will be president and COO of the combined company.

The board of the combined company will initially be comprised of nine directors, six from Tahoe and three from Rio Alto.

The company will have significant exploration potential, with 8,000 ha of approved concessions in Guatemala and a 55,800-ha land package in Peru.